Tax Rates for President Bush & Vice President Cheney
For some reason, people often wonder what kind of taxes the Presidnet and
Vice President pay. This may go along with the notion that the wealthy do
not pay their fair share of taxes. Here is recently released information on this.
Presidnet and Mrs. Bush reported adjusted gross income of $784,219 for 2004.
After deductions their taxable income was $672,788 and their federal income tax
was $207,307, or 26.4%.
Vice President and Mrs. Cheney reported adjusted gross income of over $1.7 million,
plus $426,098 in tax-exempt interest from state and municipal bonds.
Their taxable income was slightly more than $1.3 million, and they paid $393,518
in federal income taxes, or around 18.5% of their total income (taxable and non-taxable).
By comparison, the national average for federal income tax rate is around 12% each year.
(This is why the "flat tax" concept will never pass. Lower income people pay taxes at
rates well below 10%, so a flat tax would double the taxes on the poor (or tripple, or quadruple, or...). It would
also provide a windfall for the wealthy. Alternate variations on the flat tax start
adding all sorts of modifications, quickly returning us to a system no simpler than
what we have today.)
So what about the Alternate Minimum Tax (AMT) that is suppose to increase taxes
on the wealthy? (Actually, since the 1969 provision was not indexed, it hits
middle-income families as well today.) Neither the President nor Vice President
paid AMT. Why? The AMT system eliminates deductions for local taxes and personal
exemptions. Neither paid much state and local tax, and their high-income levels
had already phased out their personal exemptions. So the deductions that were eliminated
were minimal. Both of them claimed charitable contributions, and those are
deductible in both the regular tax and AMT systems. Also, as for the tax-exempt
income of the Cheneys, neither system taxes income from political subdivisions
of the government (e.g., state and municipal bonds).
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